Dow closes at record high in mixed session
10-Feb-21 16:15 ET
Dow +61.97 at 31437.80, Nasdaq -35.16 at 13972.55, S&P -1.35 at 3909.88
briefing.com
[BRIEFING.COM] The Dow Jones Industrial Average (+0.2%) eked out a closing record high on Wednesday, while the S&P 500 (-0.03%), Nasdaq Composite (-0.3%), and Russell 2000 (-0.7%) closed lower after setting intraday record highs early in the session.
The market's highs came shortly after the open, as investors remained confident in the growth prospects of the economy, but the market quickly descended into negative territory amid a sense that stock prices had increased too much, too fast. The S&P 500 went from a 0.5% intraday gain to a 0.7% intraday decline in about 45 minutes.
Price action stabilized, and the benchmark index wavered around its flat line for the rest of the session. The energy (+1.8%), communication services (+0.6%), and real estate (+0.6%) sectors advanced the most today, while the consumer discretionary sector (-0.9%) underperformed amid profit-taking weakness in Tesla (TSLA 804.82, -44.64, -5.3%).
In the afternoon, Fed Chair Powell reiterated in a speech that interest rates will remain near zero until the Fed achieves its dual mandate of maximum employment and a 2.0%+ inflation rate over time. Mr. Powell added that the central bank will maintain its $120 billion in asset purchases per month.
On a related note, total CPI was up 0.3% m/m in January (Briefing.com consensus 0.4%), and Core CPI, which excludes food and energy, was unchanged (Briefing.com consensus 0.2%). Core CPI decelerated to 1.4% from 1.6% in December. While the CPI data isn't the Fed's preferred inflation gauge, it still signaled muted inflation pressure for consumers.
The 10-yr Treasury note yield decreased two basis points to 1.13% after trading at 1.17% prior to the data. The 2-yr yield decreased two basis points to 0.10%. The U.S. Dollar Index finished little changed at 90.43. WTI crude futures increased 0.6%, or $0.36, to $58.71/bbl.
Separately, Coca-Cola (KO 49.60, -0.10, -0.2%), Cisco (CSCO 47.24, -1.26, -2.6%), and General Motors (GM 54.88, -1.18, -2.1%) closed lower despite beating earnings estimates, while Twitter (TWTR 67.77, +7.90, +13.2%) and Lyft (LYFT 56.21, +2.57, +4.8%) pleased investors with their results and commentary.
Reviewing Wednesday's economic data:
- Total CPI for January was up 0.3% m/m (Briefing.com consensus 0.4%) following a downwardly revised 0.2% increase (from 0.4%) in December. Core CPI, which excludes food and energy, was unchanged (Briefing.com consensus 0.2%) after also being revised to unchanged (from 0.1%) in December. On a year-over-year basis, total CPI held steady at 1.4%, yet core CPI decelerated to 1.4% from 1.6% in December.
- The key takeaway from the report is that it shows all is still mostly quiet on the inflation front as far as the Fed is concerned, which implies to the market that it can continue to count on the Fed not to run interference with its rally effort by raising rates or tapering its bond purchases prematurely.
- Wholesale inventories increased 0.3 m/m in December (Briefing.com consensus +0.1%) following a revised 0.1% increase in November (from 0.0%).
- The weekly MBA Mortgage Applications Index decreased 4.1% following an 8.1% increase in the prior week.
Looking ahead, investors will receive the weekly Initial and Continuing Claims report on Thursday.
- Russell 2000 +15.6% YTD
- Nasdaq Composite +8.4% YTD
- S&P 500 +4.1% YTD
- Dow Jones Industrial Average +2.7% YTD
Market Snapshot
| Dow | 31437.80 | +61.97 | (0.20%) | | Nasdaq | 13972.55 | -35.16 | (-0.25%) | | SP 500 | 3909.88 | -1.35 | (-0.03%) | | 10-yr Note | +2/32 | 1.139 |
|
| | NYSE | Adv 1606 | Dec 1565 | Vol 978.3 mln | | Nasdaq | Adv 1747 | Dec 2205 | Vol 10.4 bln |
Industry Watch
| Strong: Energy, Real Estate, Communication Services, Utilities |
| | Weak: Consumer Discretionary, Information Technology, Materials |
Moving the Market
-- Dow closes at record high in mixed session
-- Fed Chair Powell reiterated dovish policy stance in labor market speech
-- Mixed earnings reactions
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WTI crude futures edge higher amid bullish inventory data
10-Feb-21 15:30 ET
Dow +77.99 at 31453.82, Nasdaq -17.89 at 13989.82, S&P +0.95 at 3912.18
[BRIEFING.COM] The S&P 500 is trading higher by 0.1%, while the Russell 2000 is trading lower by 0.1%.
One last look at the S&P sector performances shows energy (+1.6%), communication services (+0.7%), and real estate (+0.6%) supporting the broader market, while the consumer discretionary sector (-1.0%) drags on performance with a 1% decline.
WTI crude futures settled higher by 0.6%, or $0.36, to $58.71/bbl. On a related note, the EIA reported an unexpected draw in weekly crude inventory. |
